Michigan Woman Sentenced In $2 Million Credit Union Embezzlement Case

From the Detroit Free Press on 1/4/17:

She gambled, bought a Mercedes and big motor home, took luxury vacations.

Now, a Westland woman convicted of stealing millions from a veterans credit union she ran will have up to 20 years in prison to ponder her actions.

Michigan Attorney General Bill Schuette, who called the crime "despicable," announced Thursday that Fuataina Afutiti of Westland has been sentenced to a minimum of 2½ years and up to 20 years in prison for stealing nearly $2 million from the Veterans Health Administration Credit Union, although defense attorneys said she is likely to serve the minimum term,

Afutiti not only took advantage of her position as president and CEO of the credit union, she "took advantage of military veterans, many of whom were disabled or on a fixed income,” Schuette said.

“Individuals who served and sacrificed for this country deserve the utmost respect, but instead the members of the credit union were victimized. I am pleased to see this verdict," he said in a news release.

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Afutiti, 50, pleaded guilty to one count of receiving proceeds from a continuing criminal enterprise and one count of embezzlement from a credit union, according to the release. She was sentenced Dec. 29 before Wayne County Circuit Judge David Groner.

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Read the whole story here.

Former Head of Credit Union Pleads Guilty To Embezzling Nearly $2.5 Million; Was Employed There For 37 Years

From the FBI on 7/19/2016:

On July 15, 2016, Linda Lee Clark, 68, of Corydon, Iowa, waived indictment and pleaded guilty to an United States Attorney’s Information to one count of embezzlement by a credit union employee, announced United States Attorney Kevin E. VanderSchel. Clark admitted to embezzling $2,494,809 of funds from the SCICAP Credit Union in Chariton, Iowa, from the time she began working there as a bookkeeper in 1978 until she resigned in August 2015. Clark redirected account holders’ deposits into her own personal account and the accounts of her children; and initiated unauthorized withdrawals of funds from member accounts into her own personal account and the accounts of her children. Clark concealed the embezzlement by maintaining two sets of accounting records on the Credit Union’s data processing system. As a result of Clark’s embezzlement, the Credit Union became insolvent and was forced into liquidation.

Clark faces a potential statutory sentence of up to thirty (30) years in prison, a fine of up to $1,000,000, and a term of up to three (3) years of supervised release to follow any term of imprisonment. As part of the plea agreement, Clark agreed to pay restitution. Sentencing is scheduled for 10:00 a.m. on November 15, 2016, before United States District Court Judge Rebecca Goodgame Ebinger at the United States Courthouse in Des Moines.

2016 Off To A Bang: Massive $20 Million Embezzlement Revealed At Credit Union In Michigan

Only Discovered When Alleged Perp Walks Into Police Station To Confess

From the Detroit News on 1/8/2016:

A Livingston County man known for generous acts of charity is expected to face charges for allegedly embezzling $20 million from an Oakland County credit union.

An official of Clarkston Brandon Community Credit Union is jailed after walking into the Oakland County Sheriff’s Office and admitting he had looted funds from the facility since 2003, authorities said Thursday.

The man’s story stunned investigators, who said it wasn’t known that any money was missing.

“A man walked into the sheriff’s office Wednesday morning on his own saying he wanted to give himself up because he was responsible for millions of dollars in embezzlement over a 12-year period from the credit union where he worked,” Undersheriff Michael McCabe confirmed Thursday. “We weren’t even aware of this until he came forward.”

The suspect — who is married and has young children — was arrested Wednesday afternoon, authorities said.

Investigators from the Oakland County Sheriff’s Office executed search warrants at several locations and on accounts linked to the man.

Investigators froze bank accounts of the suspect, who was not named pending formal charges.
A safe, computers and business records were removed from a Livingston County home and were still being examined Thursday as investigators attempt to track down missing funds.

It was not known what prompted the man to turn himself in, and investigators are still trying to determine if anyone else was involved. The scheme involved bogus transactions and investments to mask the taking of funds for the suspect’s own purposes, according to a preliminary investigation.
The scheme all began to unravel during a recent audit at the credit union on Ortonville Road. It remains unclear why the missing funds were overlooked.

The credit union, in operation since 1957, has more than 9,300 members, 15 employees and lists resources of more than $60 million.

A credit union official stressed the personal accounts of members are all safe and whole.

“We are currently conducting an investigation into an possible embezzlement of funds from the credit union by a former employee,” said Donna Bullard, president and CEO of the credit union. “While this investigation is proceeding, we want to assure our members that it is business as usual at the credit union.”

Bullard reminded credit union members that all accounts are insured by the National Credit Union Administration, a federal share insurance agency, for up to $250,000.

“At this time we are unable to comment any further while the investigation is ongoing,” she said. “Members will be updated in the future when more information is available.”

Investigators believe the embezzled funds went to support a lifestyle that exceeded the man’s $65,000 annual salary, including a $1.3 million, 5,800-square foot home. The suspect also started and heavily promoted a private business, one of several he told others he planned to build over the next decade.

The man, who has a bachelor’s degree in accounting, was known locally for his generosity to charity efforts for the needy. He recently was honored by a local chamber of commerce for his community service efforts.

Former State Senator In Mississippi Indicted For Allegedly Embezzling $484K From Credit Union

From WAPT Ch. 16 on 1/26/2015:

Former State Sen. Tommy Robertson, of Moss Point, has been indicted on five counts of embezzlement.

The former chairman of the Senate Finance Committee is accused of embezzling $484,092 of loan proceeds from Singing River Federal Credit Union.

State Auditor Stacy Pickering said Robertson was holding the loan proceeds in trust for the purpose of distributing the funds in accordance with the applicable loan statements.

Pickering said Robertson, 59, surrendered himself to the Jackson County Sheriff's Office Monday and was released on $50,000 bond.

Pickering said the embezzlement is alleged to have occurred in April of 2013 while Robertson was board attorney for the credit union.

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Read the whole story here.

California Woman Sentenced To 21 Months In Prison For Embezzling $480K From Credit Union

From the Orange County Register on 1/23/15:

A Lakewood woman who pleaded guilty to a protracted embezzlement scheme that resulted in the failure of a credit union was sentenced Friday to 21 months in federal prison.

Wendy Wall, 50, was sentenced by United States District Judge James V. Selna in Santa Ana.

In addition to the prison term, Selna ordered a four-year term of supervised release, which would include 12 months of home confinement and ordered Wall to pay $480,273 in restitution, the FBI said in a statement.

Wall pleaded guilty to bank fraud on Sept. 2, for engaging in the embezzlement scheme while employed at the Pepsi Cola Federal Credit Union.

Beginning in 1993 and continuing to February 2014, Wall was the manager and sole employee at the Pepsi Cola Federal Credit Union, a small financial institution in Orange County that served local Pepsi Bottling Company employees, according to the FBI.

While employed there, Wall operated an embezzlement scheme over a period of more than a decade by using her position to create fictitious bank accounts, the FBI said.

Wall withdrew funds against those accounts by creating fictitious loans and by writing checks using the accounts. Wall then deposited the misappropriated funds into bank accounts belonging to Wall or her family members, the FBI said.

The scheme was discovered following an audit by the National Credit Union Association, whose personnel contacted the FBI to investigate. Analysis indicates that the embezzlement scheme led to the eventual failure of the Pepsi Cola Federal Credit Union; however, members were indemnified against losses under an agreement with the National Credit Union Administration, the FBI said.  

Read the whole story here.

Tennessee Woman Sentenced For Embezzling $370K From Credit Union

From the Citizen-Herald on 12/2/2014:

A former employee of a local credit union who pled guilty to embezzlement in late September has been sentenced in federal court.

Latisha Cochran, 36, of Cookeville, was sentenced to serve 27 months in a minimum security facility in the case.

“She publicly apologized and said she is sorry she affected people the way she did,” her attorney, Wesley Bray, said. “She took responsibility for her actions.”

Cochran was charged with embezzlement in late July and pled guilty in September, admitting in court that she issued fradulent loans in the names of fictitious individuals while employed at Middle Tennessee Federal Credit Union. She admitted she used the funds from the fradulent loans for her own personal use and also used fradulent credit cards associated with the loans to make personal purchases.

She also admitted to taking actions to hide her embezzlement, including opening accounts in fictitious names, using ficticious addresses, fabricating loan documentation, conducting transactions outside of normal business hours, making loan payments using embezzled funds and shredding loan files.

She admitted to embezzling more than $370,000.

“She made a payment today in that restitution,” Bray said, with the total restitution being $300,000. “Her cooperation and lack of a criminal record also helped in her sentencing.”

She faced up to 30 years in prison and a fine of up to $1 million.

She is to serve 80 percent of her sentence.

Former Credit Union Manager In Kansas Ordered To Pay Restitution In $173K Embezzlement Case

From the Lawrence Journal on 11/25/2014:

Former Jayhawk Federal Credit Union manager Karolyn J. Stattelman, 43, of Topeka, was sentenced Tuesday to three years of probation and ordered to pay more than $173,600 in restitution after pleading guilty in June to one count of theft from a credit union....

National Credit Union Administration Bans 3 In October For Egregious Embezzlements

From the Credit Union Times on 10/31/2014:

The NCUA issued prohibition orders to several individuals in October for embezzlement.
Reginald Clark, a former accountant at the $20.7 million Hoya Federal Credit Union in Washington, stole nearly $200,000 from the credit union, according to the NCUA.

He was sentenced to 63 months in prison and ordered to pay restitution in the amount of $219,286.41, the NCUA said. ...

Jennelle Curtis, a former accounting assistant at the $109 million Pinal County Federal Credit Union in Casa Grande, Ariz., pleaded guilty to two charges of embezzlement.
Curtis was sentenced to a one year in prison, five years of supervised release and ordered to pay $555,571 in restitution.

To avoid the time and costs associated with administrative litigation, Kendra Jill Moore, a former employee of the $258.5 million Partners 1^st Federal Credit Union in Fort Wayne, Ind., consented to the issuance of an order of prohibition. ...

Read the whole story here.

Former New Mexico Credit Union Employee Pleads Guilty To Embezzling $118K

From the FBI on 10/21/2014:

ALBUQUERQUE—Louisa Gabaldon, 43, of Belen, N.M., pleaded guilty this morning to a federal bank fraud charge under a plea agreement with the U.S. Attorney’s Office.

Gabaldon was indicted on Aug. 7, 2013, and charged with 12 counts of bank fraud. The indictment alleged that from Jan. 2004 through July 2010, Gabaldon engaged in an illegal scheme to defraud her employer, the Belen Railroad Employees Credit Union (Credit Union) by making fraudulent withdrawal of funds from accounts belonging to the Credit Union’s customers.

Today, Gabaldon pled guilty to Count 5 of the indictment charging her with fraudulently withdrawing $31,000 from a customer’s account on July 31, 2006. The plea agreement, however, requires Gabaldon to pay $118,376.56 in restitution to cover losses associated with all 12 counts in the indictment as well as related losses suffered by the Credit Union.

In entering her guilty plea, Gabaldon admitted that, while employed by the Credit Union, she had loan approval which permitted her—when authorized by customers—to make withdrawals from customers’ accounts, transfer funds among their accounts, increase the amount of their loan accounts and open new loans in their names. Gabaldon admitted that, without the knowledge or permission of Credit Union customers, she added amounts to customers’ existing loan accounts and opened new loans in their names and used the funds to pay for her own debts and to make a partial payment for the purchase of a home. In order to conceal her fraudulent activity, Gabaldon moved funds among customers’ accounts to make it appear as if loans had been repaid or funds were replaced.

At sentencing, Gabaldon faces a maximum penalty of 30 years in prison. She remains on conditions of release pending her sentencing hearing, which has yet to be scheduled.

Major Embezzlement Cases: August 14 - 20, 2012

Cheryl Porter

Cheryl Celeste Kenyon Porter, 45, of Greensboro, North Carolina, pleaded guilty to charges she embezzled about $162,000 from Piedmont Staffing Solutions Inc., where she had been employed and had the responsibility of handling the company's payroll.  According to authorities, Porter caused the payroll system to cut additional payroll checks to herself and family members, totalling $162,000.  The thefts spanned a period of about 4 years, beginning in 2008.

Heather Nicole Laake, 21, of Winifrede, West Virginia, has been charged with embezzling more than $101,000 from the South Charleston Employees Federal Credit Union where she had been employed.  According to authorities, Laake took funds from customer accounts and changed the account information in an effort to conceal the thefts.  Laake's boyfriend at the time, Dewayne Spaulding, is also facing similar charges.  The misappropriations reportedly spanned a 4 month period. 

Stennett “Glen” Bernard, 58, of Brockton, Massachusetts, was sentenced to 5 years probation and ordered to pay restitution for embezzling $173,312 from the United Steelworkers Local 421 union which operated at the Serta Mattress Company in Middleboro, Mass.  Bernard had served as president of the union from which he siphoned funds over a period of about 2 years. 

Joseph Winford Hughes, 44, and his wife, Cylena Taylor Hughes, 44, both of Bryson City, North Carolina, were arrested and charged with embezzling more than $100,000 from the Bryson City Fire Department local Firemen’s Relief Fund and the East Swain Elementary Parent Teacher Organization fund.  Joseph Hughes was the Bryson City fire chief. 

Pamela Fisha Nishon Atkinson, 41, of Asheville, North Carolina, was arrested and charged with embezzling more than $100,000 from Wood Tech Enterprises over a period of about 2 years, from 2009 to 2011.   Developing...



Cathleen Schmid

Cathleen Schmid, believed to be in her mid-40s, has been arrested and charged with embezzling about $220,000 from Dominion Liquid Technologies of Fairfax, Ohio.  The thefts reportedly spanned a 3 year period, from 2008 through 2011.  Schmid allegedly submitted fraudulent expense reports for reimbursement and caused the company to issue checks to third party personal vendors to whom she owed money.

Update (11/20/12): Schmid, 47, was sentenced to 2 years in prison.  She has a history of embezzlement and was convicted in:

• 2006 for stealing $51,126.82 from Hills Developers, where Schmid worked from March 2003 to August 2005. She also used fake invoices there to help her steal company money. She was placed on probation and ordered to repay the company;
• 2009 for stealing $10,000 from her Mason employer, National Starch, now known as Henkel Co. She was placed on probation for three years in 2009 and ordered to spend 150 days in jail on a work release program. She was working for Dominion at that time;
• 2000 in Clermont County for a theft case for which she received probation, the judge said Monday. It’s unclear if that conviction was for stealing from an employer.

Mirza H. Baig, 49, of Marlborough, Massachusetts was sentenced to 51 months in federal prison for embezzling more than $2 million from New England Cash Dispensing Systems Inc. which was contracted to manage ATMs for the Domestic Bank of Cranston, Rhode Island.  Baig and other NECDS employees reportedly ordered excess cash for ATM refills and pocketed the difference.

Washington State Man Sentenced For Embezzling $440K From Bank

Edgar Hugh Kelly, 37, of Tacoma, Washington, was sentenced to 33 months in prison for embezzling some $440,000 from the KBR Credit Union where he had been employed as a teller and an office manager. According to authorities, Kelly engaged in an "elaborate scheme" to misappropriate money from the credit union, which serves employees of Simpson Construction, over a period of "several years." The scheme reportedly involved strategically timed fund transfers and altered financial documents. Kelly's thefts were discovered after he submitted false documents to auditors. Kelly, who was originally charged in October 2010, plead guilty last November theft from a lending, credit, or insurance institution.

Read the story here and here.

Update: Kelly was sentenced to 33 months in prison.

Missouri Woman Pleads Guilty To Embezzling Nearly $400K From Credit Union

Joyce Buchanan, 55, of Kansas City, Missouri, pleaded guilty to charges she embezzled nearly $400,000 from Media First Credit Union, now known as First Financial Credit Union, where she had been employed as a branch manager. Specifically, Buchanan plead guilty to a two count information alleging theft from a credit institution and bank fraud. The credit union serves employees of The Kansas City Star. Buchanan admitted she embezzled $198,250 from the credit union over more than a four year period, from December 9, 2002 through January 16, 2007. She also misappropriated $198,553 in fraudulent loans. She faces up to 60 years in prison, plus fines of up to $2 million and restitution.

Read the story here.

Read the DOJ announcement here.

Hat tip: Reader Joe.

Update (11/4/10): Buchanan, now 56, was sentenced to 2 years in prison yesterday.